Financial Transparency Coalition

The United Kingdom is shifting some tax laws to make it easier for multinational corporations to avoid taxes via tax havens, through vehicles known as Controlled Foreign Corporations (CFCs). These vehicles are commonly used in the United States, and elsewhere, to shift profits to low tax jurisdictions. They are a legal way of pretending you made more where you did not. You would think that any smart country would be moving toward stricter laws to prevent the use of tax havens for profit shifting and corporate tax avoidance, but that's not the most important part of the law's impact....

LONDON - New research has revealed that 56% of British adults believe that tax avoidance by multinationals companies (MNCs), while a technically legal way of reducing what they owe the taxman, is morally wrong, and half of people think it should be made illegal. Only four per cent of those polled thought tax avoidance by MNCs was ‘morally justifiable’ and only four per cent described such practices as ‘fair’.

According to a recent editorial from The Guardian, the illicit activities that drive capital flight, such as drug trafficking and terrorist financing, are actually supported by legal infrastructure. Namely, the lack of transparency in regions designated as "tax havens" allows for elaborate tax avoidance schemes and money laundering that funds these sorts of activities. As an example, banking company HSBC reportedly held a Cayman Islands subsidiary that "handled some 60,000 accounts," which "drug lords used . . . to fuel their jet-set lives." According to the newspaper, politicians must address the issue of tax haven abuse. In affected countries such...

It was a busy Tuesday night for the tax justice campaign team. Many of us here at ActionAid were hearing from the fantastic campaigners that we had speaking at our event (more on that later). And a few more were glued to the Finance Bill debate in Parliament.